Cayuga and Seneca counties hope their luck changes and they win a favorable court ruling in the next step of their ongoing cigarette-tax dispute with the Cayuga Indian Nation.

In July, a state appellate court ruled the Cayugas could resume selling unstamped cigarettes without fear of criminal prosecution at their two stores in Union Springs and Seneca Falls. In a 4-1 decision, the court said the stores are on qualified reservation land -- for tax purposes -- because they lie within the nation's ancestral homeland around the north end of Cayuga Lake.

Now, the counties have filed a motion asking the same appellate court for permission to challenge that ruling before the Court of Appeals, the state's highest court. The Cayugas opposed the request and a ruling is due any day.

"We've asked the appellate court to grant leave to the Court of Appeals, and we're hoping the Court of Appeals will settle the state of the law for the state of New York," Cayuga County Attorney Fred Westphal said Tuesday.

The Cayugas filed a counter motion asking the appellate court to deny the counties' request.

"Our response is that the Court of Appeals does not need to hear the case, that the Appellate Court got it absolutely right (in its July decision)," said Lee Alcott, a Syracuse lawyer representing the Cayugas.

After the appellate court ruling, the Cayugas offered to forego suing the counties for millions of dollars in damages and lost income if the counties agreed to not appeal the decision. The counties spurned the offer, saying they did not want to concede sovereign rights to the nation. The Cayugas have yet to start the lawsuit, Alcott said.

The counties have another option if the appellate court rejects their request to have the Court of Appeals hear the case. The counties could ask the state's highest court to hear their appeal, Alcott said.

The dispute boiled over Nov. 25 when both counties conducted simultaneous tax raids and seized some $500,000 worth of unstamped cigarettes from the nation's two stores. The counties claimed the Cayugas owed some $485,000 in taxes on the smokes; the nation said it did not have to pay the taxes because its stores were on qualified reservation land and there was no state mechanism in place to collect taxes from non-Indians.

The counties still hold the perishable cigarettes as evidence in their criminal cases, despite attempts by the Cayugas to regain possession of them.

In December, state Supreme Court Justice Kenneth R. Fisher sided with the counties. In his ruling, Fisher said the Cayugas could not sell tax-free cigarettes and that the counties could pursue criminal tax-evasion charges against the nation.

The Cayugas later won a court order that temporarily blocked the counties from prosecuting the case, which led to the appellate court overturning Fisher's decision in July.